David Long

German Powerhouse Starting to Stumble – Forex Trading News – Aug 12th 2014

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Forex Market News

Sanctions both ways is starting to bite in both Russia and Europe. The German powerhouse is starting to stumble, the GDP on Thursday will show us this. The economic strength that helped Europe (Portugal, Italy, Greece, Spain) out of pain is now feeling the pinch. Lost sales out of Russia is hurting them badly. On the other side, Russia too is slowing down and Putin has frozen domestic financing so he can keep ready cash for the looming crisis. Their trade balance out overnight and GDP have both shrunk and will continue to slide as sanctions deepen. However, they backed away from the Ukrainian border again this week and this saw safe haven flows reverse somewhat in the last two trading sessions. So maybe, just maybe (ok, unlikely), Putin will back off his aggressive stance and the world economy can grow. If he maintains his position, or increases his expansion, things will continue to deteriorate. The US is a toothless tiger these days and will continue to use sanctions to try to curb both China and Russian expansion. However, that will really only hurt the global economy. Not saying that the US should go to war on everyone, war is the last resort and a terrible effect on all involved, but war is good for the economy….just sayin.


Here is an article of interest and I will be watching it keenly as my bullish stance on the Pound comes under threat. http://www.bloomberg.com/news/2014-08-11/pound-advances-against-euro-as-investors-await-inflation-report.html . The inflation report is out Wednesday 730pm Sydney time.

DATA HIGHLIGHTS TODAY – AU NAB Biz confidence. EU German Economic Sentiment.

AUDUSD – Still flapping about in the 250 pip range (9200-9450). Is on the lower side of it as is momentum. A break of 92 though will see us looking at 90 rather quickly.
Resistance: 9460/9522
Support: 9200/9085/8900

EURUSD – Trying to retrace its recent fall, but an inside bear bar shows weakness in the min-rally.
Resistance: 13500/13650/13890/14050
Support: 13416/13300/13170

GBPUSD – An inside buyer bar, also weak and non-committal. Looking for a good inflation report from Carney tomorrow for the new rally in the pound. We have bullish reversal divergence in the momentum indicator. If it breaks below May lows of 1.6692 then all bullish bets are off.
Resistance: 1.7183/1.731.7370
Support: 1.66/1.63

NZDUSD – Inside bear bar, another non-committal sign, also has momentum overdone and looking to retrace but just cannot do it yet.
Resistance: 8745/8842
Support: 8434/8090

USDCAD – Same, inside bear bar, wanting to retrace but hasn’t got the legs yet.
Resistance: 10855/10950
Support: 10683/10655/10486

USDJPY – Messy looking chart, momentum in the middle of the range. Could go either way from here. Until a clear indication of which way I would stay away.
Resistance: 105.57/108.35/110.50
Support: 101.30/100.62/100/99.80

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